At the same time, inside the Shanghai Ultra-Short Band major hot money group chat, Xu Qiao stared at the instantly changing market trends of the two exchanges.
Seeing the buying interest for core stocks related to sectors like real estate, steel, coal, and non-ferrous metals appearing to decay, he actually executed an operation completely opposite to the "Foshan faction": he began to further increase his position, actively injecting capital to absorb the market through active buying orders.
"So quickly? Has a divergence already appeared in the market's main theme?" At the same time, Old Zhang couldn't help asking in surprise.
"Not surprising," Lao Wu replied. "Having experienced the continuous decline of the market over the past half year and the lesson of various one-day-wonder rallies, a large number of retail investors in the market are now like birds startled by the mere twang of a bow. The moment the market order books weaken even slightly, all kinds of profit-taking sell orders will pour out endlessly."
"It seems that if the market wants to forge a sustained rally, it's truly not easy," Old Zhang said. "Judging from the current order book trend, it's very likely that by the afternoon, these major core sectors—real estate, steel, coal, and non-ferrous metals—will experience a high-altitude diving and pulling-back movement. After all, market trading volume is still in a depressed state; without a massive influx of new external capital, it's hard to sustain the continuation of the rally!"
"These major core sectors will most likely take a high-altitude dive this afternoon," Lao Wu said.
"Diving is great," chuckled Xu Qiao, who continued to buy into the market. "Divergence at this position is actually more conducive to the subsequent fermentation of the market rally. I feel that since Brother Su's seat has entered, and since the 'Huayi Expedition No. 1' fund product he manages is indeed increasing its long positions heavily in the arena, then... I judge that the major main-theme rallies guided by Brother Su will definitely not be a one-day wonder.
Since Brother Su's goal aims at the long term. And given the capital volume and seat influence of the 'Huayi Expedition No. 1' fund product managed by Brother Su, it is entirely sufficient to guide the market trajectory.
Then, this point of divergence in capital and sentiment is definitely a buying point, not a selling point."
"Brother Xu makes sense," Brother Chen said with a smile. "Brother Xu's thinking logic and market manipulation framework are the correct ones. I pondered this carefully...
My preliminary judgment is that Brother Su's purpose in entering the market to go long is definitely not to capture profits from a brief two- or three-day rebound rally in the market.
Rather, he is aiming at the fundamental reversal of the major core main-theme industries and the long-term profits of doubling or even multiplying several times over in the future. Otherwise, he wouldn't be building positions and grabbing shares simultaneously in both the A-share and H-share markets.
Since the expected logic of these major core main themes is long-term, it indicates that these major core main themes are capable of withstanding continuous and repeated speculation.
That being said, this bottom divergence point at present is obviously a buying point, rather than a selling point.
From a long-term perspective, the chips at this position are precious. Even from the perspective of short-term speculation, this point of divergence is even more favorable for the further fermentation of the market's main theme rally."
"Does Brother Chen mean... that we can continue to go long?" Old Zhang asked.
Brother Chen replied, "I think continuing to go long at this position poses absolutely no problem. As long as we hold the chips bought during the intraday session for a couple more days, we will definitely be able to exit with a profit."
"However, absorbing them right at this moment isn't strictly necessary," Lao Wu chimed in. "I think the afternoon, when market divergence magnifies and core individual stocks take a high-altitude dive, will be the absolute best buying point."
"Agreed," Xu Qiao chuckled.
Amidst everyone's discussion, the divergence among the various market main themes was growing larger and larger.
The main-theme concept and thematic stocks that had locked their daily limits early in the morning session successively began to break their limit boards under the pressure of profit-taking sell orders.
Meanwhile, starting from the morning session, major institutional capital across the board had been following the trend to grab shares and continuously push up stock prices for heavyweight core stocks in the real estate, steel, coal, and non-ferrous metals sectors—such as Poly Real Estate, China Vanke, Baoshan Iron & Steel, Anhui Conch Cement, and China Shenhua Energy.
Their fractional volume suddenly experienced a rapid surge, and the profit-taking selling pressure grew heavier and heavier.
This caused the actively absorbing institutions to hesitate involuntarily for a moment.
"What's going on? Why is the selling pressure so heavy?"
Seeing that all core heavyweight stocks had begun to surge and pull back, with order book selling pressure growing heavier and heavier, Jia Yongxiang—the trading team leader inside the trading room of the Shanghai Huairui Fund Management Company's 'Huairui Performance Elite Growth No. 1' fund product, which had shifted its trading strategy to heavily increase long positions in the real estate, steel, coal, and non-ferrous metals sectors—showed a distinctly puzzled expression on his face.
"Are other major institutional players who previously lurked in these main-theme core stocks taking the opportunity to dump shares and reduce positions?" Fund Manager Song Shaopu asked, "Or do you feel there are other anomalies?"
Jia Yongxiang thought for a moment and said, "I don't know. It just feels like active buying on the order books is experiencing a cliff-like drop, while the overall market's long sentiment and retail-following sentiment are rapidly ebbing. Logically speaking... it shouldn't be like this. How could such a strong offensive momentum and sentiment in the morning session rapidly evolve into this?"
"Active buying is experiencing a cliff-like drop, while active selling is surging and multiplying..." Song Shaopu pondered carefully for a moment and said, "This indicates that under the inadequacy of market trading volume, internal divergence within the market is surging significantly. At the same time, the major capital that previously dominated the order books is continuously retreating."
"You mean... the institution Huayi Capital?" Jia Yongxiang asked.
Song Shaopu nodded and said, "It's possible!"
"Shouldn't be, right?" Jia Yongxiang said. "I feel that Huayi Capital shouldn't have changed its trading strategy at this point. Moreover, with such a massive capital volume entering, it's unlikely they came in just to play short-term speculation, right? Plus... didn't we analyze and clearly understand that the fundamental logic of these major core main themes is reversing?"
"In our analysis, the logic is definitely without any problem," Song Shaopu said. "However, apart from the logic in our analysis, we also have to respect the trajectory of the order books. If the market trend has consistently fallen short of expectations, it indicates that the logic we analyzed has not been recognized by the market. As such... it should raise our vigilance."
"Then right now, we..." Jia Yongxiang said with some hesitation.
Song Shaopu thought for a moment and said, "Since market long sentiment is decaying while selling pressure on the related core main themes continues to increase, let's wait and see. Let's observe how the subsequent market feedback pans out.
If the macroeconomic logic is sound, and if the core major institutional player Huayi Capital hasn't altered its established investment strategy and still intends to defend the order books and maintain the rally trend of these major main themes, then in the subsequent market feedback, it will definitely leave traces.
In a bear market, there are plenty of market chips; we don't need to be in too much of a rush."
(End of Chapter)